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I was suggested some modifications in my post " cashless.....". What could be the effects on business or society was a point i totally forgot to think upon. As any other system, this system is also not free from defects. For instance the system will face a big implementation problem because of its transparency. No nation would like to disclose any strategic expenditure on various fronts. Not only nations, an individual would also not prefer to disclose all expenditures even if they are totally legal in nature. For example i may buy a gift for my girl friend but i dont want my father to know abt it, so security and privacy become a big issue.

Another instance or situation which would pose a challenge is WAR. All expenditures would be traceable and important decisions could be speculated. Besides these instances the system also will tend to change the way business was done. Since all transactions are available the government can bring different regulatory measures to exercise more control and wield more power on the corporates.

The proposed system is an ideal one which is very difficult to achieve but surely the governments are trying to achieve a similar world as had been proposed.

ATMs, credit cards, online trading, Dmat accounts etc. A new way to transact, trade and transfer money. Have we imagined a world when no one needs any cash? Yes! No cash, and the engine of the world still runs fast and healthy, so as to say, normally.

Sounds outrageous? Let me explain.

Consider a small location where there is one supplier (S), one company (C), a bank (B) and a consumer (P). Further, assume that C can make, all that the consumer needs to consume, available. Also suppose that the supplies required by C for its operation, are met by S alone. Moreover, the good old bank plays just the bridge (read transaction facilitator).

P buys the products and pays using one of the “modern techniques”. The money is transferred from P to C’s account. Note that the transfer is only virtual as C does not get the money physically, though it can, if it so desired. C pays S in a similar fashion. If these individual units are only dependent on each other and they get whatever they require from amongst themselves; why would they need cash. “They would need it because you cannot just stand alone and exist”, some of you might think. It is hard to imagine that, a phone call, a mouse click or a swap of the card will govern the day-to-day operations especially when its existence is possible only in a closed system. But the moment this idea is universalized (rather a more modern term globalized) in the literal sense, everything becomes a part of the system and no needs, desires or expectations are left which cannot be fulfilled within the system itself. What I am suggesting is a normal e-transaction at every possible level similar to a transaction at various locations using an atm or internet.

What is required is no sophisticated accounting principles or an out of the world technology but a mere determination to network the entire world controlled by a central transaction facilitator with the help and in sync with the other regional facilitators. This is a very big challenge in it self, plus the dangers that the system might face even it was (is) possible to network. In case of a natural calamity like an earthquake or the new destroyer tsunami, or may be a war, political upset (ideology) in the country, the system is vulnerable and the network may be hit badly. In addition, what about the computer whiz next door who wanted to try the effect of his virus on the system. This system sure needs protection against all of these as well as all those other dangers that might come up from time to time.

However, we need to understand that the problems that may arise are not in the nature of the transaction but due to the nature of the man and the nature itself. Nevertheless, when there is so much trouble in making this idea a reality why is it that I am talking of it. What benefits can mankind derive? Is there any purpose served? Is it worth? The answer to all these questions is not easy but to put it in short sentence, yes its worth. Its worth, if we want to accept the benefits. The risk is high but not as high when we compare it with the returns.

 The benefit is fair practices. How would black marketing exist when there will be no cash transaction? Will anyone be able to evade tax if he/she can pay only through banks? Can smuggling exist without hidden transactions? The system puts in place automatically all that, which most of us have always been talking about. No corruption, no bribing, no black money. Not even undisclosed assets, because if they are undisclosed, they wont be assets any more. Perfect transparency in every single transaction and perfect accountability for every activity, results from this system. Along with this, also made available, is a huge pool of information, regarding people’s real spending and management of funds, a resource for all the organizations, economists, educationists, research analysts, governments and businesses. It will help in policymaking, understanding the effects of the policy on a global scale and the expected response of the people, academia, industry and nations. Moreover, not to mention a secure and hassle free life for all those who need to travel a lot.

The machinery of the world goes on in spite of the fact that there is nothing material to transact in exchange of goods and services. I work and so do you; we are not paid (as a physical practice) because it is not necessary. Goods are produced, goods are consumed, and again we do not pay anything tangible.

            This idea may take fifty, hundred or a thousand years to become a reality, or for that matter it may never become a truth but what is good to know that, that money may drive the world as of now as well as in future but the evils that money nourishes wont remain forever.